I've had this odd issue with reading discs that happened on other system and now my FZ-10. I Just put in burns of Unlucky Pony & Where's Derpy and afterwards I put in an unharmed audio CD and it's acting like someone took sandpaper to it, as I'm typing this it's now jumping tracks!

I had this problem before on one of my Saturns all of my Dreamcasts, basically I just put in a legit game disc and then go back to a CD-R or Audio CD and it will play fine. I'm about to go in the other room and grab a normal 3DO game and see if my fix works on the FZ-10 as well. I'll make an edit letting you know if it works. EDIT: Major improvement, still a tiny bit of skipping.